The new extended collateral-term repo facility has been established to offer sterling to banks for 30 days in exchange for a wide range of collateral, if liquidity conditions for trade in sterling deteriorate.

One trader said conditions in the credit default swap market and the short-term repo markets are more stable today than they were in March, when Bear Stearns nearly collapsed, but still, "if they go into liquidation," it is going to be a bad situation on Monday.

The Fed has already announced several initiatives to provide additional liquidity to the MBS market, including expanded, longer-term repo operations in which bond dealers pledge MBS to borrow short-term funds from the Fed.